Managed Care Fair Payment Act of 1998

Managed Care Fair Payment Act of 1998 - Amends part C (Medicare+Choice) of title XVIII (Medicare) of the Social Security Act, as amended by the Balanced Budget Act of 1997, with respect to the formula for the annual area-specific Medicare+Choice capitation rate. Revises such formula for years beginning with 1999 to exclude from the adjusted average per capita rate of Federal payment for 1997 any payments attributable to disproportionate share hospital (DSH) payments. Requires the Secretary, for any such 1997 payment rate that reflects payments covered under a State hospital reimbursement system, to estimate a payment adjustment comparable to the adjustment that would have been made if the hospitals had not been reimbursed under such system. Directs the Secretary, for portions of cost reporting periods occurring on or after January 1, 1999, to provide for an additional payment for each DSH discharge of any managed care enrollee: (1) enrolled under a risk-sharing contract with an eligible organization who is also entitled to Medicare part A benefits; or (2) enrolled with a Medicare+Choice organization. (Thus requires that DSH payments be made directly to a DSH in which a managed care enrollee actually receives care, and not to the enrollee's Medicare+Choice organization for subsequent payment to such DSH.)